Delhi High Court
Itc Limited vs Food Corporation Of India on 16 August, 2017
$~S-1 of 14.08.2017
* IN THE HIGH COURT OF DELHI AT NEW DELHI
% Judgment delivered on: 16.08.2017
+ W.P.(C) 7145/2015
ITC LIMITED ..... Petitioner
versus
FOOD CORPORATION OF INDIA ..... Respondent
Advocates who appeared in this case:
For the Petitioner : Mr Arvind Kumar Nigam, Senior Advocate with Mr Mikhil
Sharda, Mr L.K.Bhushan, Ms Raashi Beri and Mr Akshay
Bhandari
For the Respondent : Mr Om Prakash and Ms Arzoo Raj, Advocates.
CORAM:-
HON'BLE MR JUSTICE SANJEEV SACHDEVA
JUDGMENT
16.08.2017
SANJEEV SACHDEVA, J. (ORAL)
CM No.25936/2017(delay in filing rejoinder for 60 days)
For the reasons stated in the application, the application is
allowed. The delay in filing rejoinder is condoned.
REV. PETITION No.64/2017(review of judgment dated
22.12.2016)
1. By this Review Petition, petitioner seeks correction of a
mistake apparent on the face of the record in judgment dated
22.12.2016.
2. The petitioner, by the writ petition, had sought quashing of the
decision of the respondent, whereby respondents had decided to
forfeit the security deposit given by the petitioner. The security
deposit was given for due performance of an Agreement, whereby the
petitioner was to lift specified quantities of wheat from the Food
Supply Depots of the respondent at Mokama and Buxar.
3. The petitioner was not able to lift the specified granted quantity
of wheat. The contention of the petitioner had been that it could not
lift the entire stock on account of Force Majeure conditions and due
to operational constraints of the respondents.
4. On failure of the petitioner to lift the specified grain quantity,
the respondents had decided to forfeit the security deposit.
5. This Court, by judgment dated 22.12.2016, came to the
conclusion that the petitioner could not lift the food grain due to Force
Majeure as well as operational difficulties of Food Corporation of
India. In view of the findings of the Court that the non-lifting of the
food grain was not on account of the fault of the petitioner but on
account of Force Majeure conditions as well as operational
difficulties of Food Corporation of India, it was held that the action of
the respondent in forfeiting the security deposit could not be
sustained. The action of the respondent in forfeiting the security
deposit was quashed and respondents were directed to refund the
security deposit.
6. The security deposit amount forfeited by the respondent is
Rs.1,13,10,702/- . The security deposit forfeited also contained an
amount of Rs.42,56,250/- towards Earnest Money Deposit.
7. In the judgment dated 22.12.2016, it is noticed that the
respondents themselves have refunded to the petitioner the cost of un-
lifted quantity.
8. On account of an error, it has been noticed in the said judgment
that the entire cost of un-lifted quantity has been refunded to the
petitioner whereas the admitted position is that only part of the cost of
un-lifted quantity has been refunded to the petitioner. The respondent
has been directed to refund the security deposit of Rs.42,56,250/-.
9. The figure Rs.42,56,250/- relates to Earnest Money Deposit,
which is one of the components of the security deposits and not the
entire security deposit amount forfeited by the respondent which is
Rs.1,13,10,702/- .
10. The errors referred to above in 14, 16, 18 and 21 are corrected.
The words omitted from the said paragraphs have been shown as
struckout and words added have been shown with italics and
underlined.
11. After correction, paragraphs 14 to 21 of Judgment dated
22.12.2016 shall be read as under:-
"14. It is an admitted position that part of the said amount has
been refunded.
15. The issue pertains to only the forfeiture of the security
deposit and its refund.
16. The reports of the two Depots clearly show that there
were operational difficulties on the part of Food Corporation of
India. Even the General Manager of the respondents, in his
letter dated 08.05.2013, has admitted that non-lifting of the
food grain was due to Force Majeure as well as operational
difficulties of the Food Corporation of India. Consequent
thereto, the entire part of the cost of unlifted quantity has been
refunded to the petitioner.
17. Since the security deposit was deposited for the purposes
of furtherance of the contractual terms and the respondents
themselves have admitted, that petitioner could not lift the stock
because of operational difficulties and Force Majeure
conditions, the petitioner cannot be held liable for any breach
for not complying with the terms and conditions of the
Contract.
18. The respondents have themselves refunded the entire
part of the cost of unlifted stock because of Force Majeure
conditions and their own operation difficulties. This amounts to
an admission on the part of the respondents that the petitioner is
not at fault or in breach of any of the condition of not lifting the
entire stock.
19. Since the petitioner is not in breach of the said tender
condition due to Force Majeure conditions and the operational
difficulties on the part of the Respondents, the respondents
could not have forfeited the Security Deposit, which was given
solely for the purposes of ensuring compliance of the terms and
conditions of the Contract.
20. In view of the above, the action of the respondent in
forfeiting the security deposit cannot be sustained. The same is
accordingly quashed.
21. The respondents are directed to refund the security
deposit of Rs. 42,56,250/- Rs. 1,13,10,702/- within a period of
four weeks, failing which the respondents shall be liable to pay
simple interest at the rate of 9% per annum till the refund is
made in full."
12. The Review Petition is allowed in the above terms.
13. The Registry is directed to upload today's order as a
Corrigendum to the judgment dated 22.12.2016 and shall also place a
copy of the same on the Website along with the judgment dated
22.12.2016.
14. Order Dasti under signatures of the Court Master.
SANJEEV SACHDEVA, J
AUGUST 16, 2017
'Sn'
